Internet blackouts are costly
Economies suffer losses of millions of rands when governments shut down web access
In recent civil protests around the world citizens have used social media as a tool to express their grievances with their respective governments. In turn, some governments have resorted to shutting down access to the internet as a way of silencing their restive populations, which has had the unintended consequence of costing the global economy billions.
Research by TOP10VPN has shown that, from 2021 to date, there have been 30 internet shutdowns in 19 countries, which have cost a total of $3.5-billion. In 2019, there were 235 major internet shutdowns in 44 countries, resulting in a loss of $15.6-billion to the world economy.
These shutdowns prevent businesses from selling their products online, stop mobile money transactions from taking place, and disrupt international commercial communication, according to Samuel Woodhams, a digital rights researcher at TOP10VPN.
In the long term, they may also weaken international investor confidence. “The economic damage caused by a shutdown is largely influenced by the size of the digital economy in a country. The more reliant an economy is on the internet to function, the more damaging an internet shutdown is,” he said.
Recently, Eswatini erupted as prodemocratic protests turned increasingly violent. King Mswati III has ruled the landlocked kingdom as an absolute monarch for 35 years, but citizens want more democratic reforms. Authorities have responded by trying to stifle the flow of information. Residents were angered after MTN’S Eswatini subsidiary cut off the internet. According to TOP10VPN, the shutdown, which lasted for 216 hours, cost the kingdom’s economy $15.8-million.
Similarly, in Cuba last month, authorities blocked internet access as citizens protested against food shortages, power cuts and Covid-19 restrictions. Last year, the Ethiopian government shut down internet access during protests triggered by the assassination of musician and activist Haacaaluu Hundeessaa.
MTN has been in the crossfire in several of these internet blackouts, including the Twitter shutdown in Nigeria during the ENDSARS protests last year and the total blackout imposed across Uganda before elections in January.
The company has operated in Eswatini since 1998; it competes with Eswatini Posts and Telecommunications Corporation and Eswatini Mobile. These companies are regulated by the Eswatini Communications Commission which, says MTN, issued a directive to suspend social media and online platforms during the protests.
MTN said it obeyed the directive after consulting its digital human rights due diligence framework.
The company said it believed in the rights of all people using digital communications to communicate freely, share information and opinions, and to enjoy the right to privacy and information security without interference, but added: “We respect and endeavour to comply with the laws of the countries in which we operate.”
MTN’S framework has been drawn from the UN’S guiding principles for business and human rights, and outlines the steps that all the company’s operations should follow before, during and after a digital human rights incident. Due diligence includes assisting risk, confirming validation and ensuring that the company complies with the laws of the country.
Felicia Anthonio, a campaigner at Access Now, an international human rights organisation focusing on digital rights, said MTN had committed to undertaking a “robust due diligence approach” in its response to shutdown requests. The rights group, however, needed “to see evidence that this due diligence is actually taking place in this instance and in any case where MTN complies with a shutdown order”, she added.
Anthonio said telecoms companies were complicit in implementing internet shutdowns, and should rather resort to protection from the courts when receiving shutdown orders. “It is about time they challenge internet shutdowns legally and be transparent to reduce the harmful impacts shutdowns have on people,” she said.
Anthonio said companies in both democratic and nondemocratic countries continued to implement shutdown orders from governments, although restrictions were likely to be more stringent in autocratic states, where firms could not always rely on independent courts and political institutions as a check.
The global process of telecoms reform and opening up the market to multiple players is premised on the rule of law; commitment to human rights; and independent regulation to avoid regulatory capture, either by the state or industry, said Alison Gillwald, the executive director of research at digital policy and regulatory think-tank Research ICT Africa.
But in many countries, these conditions do not exist. In the early years of digital telecoms, announcements by countries that they were open for business allowed operators like MTN with greater appetite for risk to go into these untapped markets — often described as “not an environment for sissies” — because of the significant returns they could realise.
Gillwald said the failure to create an environment conducive to investment certainty in many African and other countries has resulted in “first tier” investors looking elsewhere.
Earlier this month, MTN Group chief executive Ralph Mupita told Reuters that it had abandoned its
operations in civil-war-hit Syria because it was “intolerable” to operate there. It is also considering exiting Afghanistan, News24 reported.
Gillwald said: “Like many other operators, but perhaps because they operate in so many countries much more so, MTN entered into Faustian pacts to secure licences — agreeing to political parties, family members of presidents or kings holding equity in companies to secure [its] licences. These have not always provided [the company] with protection from arbitrary state action but, rather, have embroiled [it] in political settlements and systems of patronage.”
In a statement, MTN said it had looked at the licensing conditions before determining to follow the Eswatini directive.
The Mail & Guardian asked legal and regulatory specialist Kerron Edmunson whether MTN’S licence would likely have been revoked had it not followed the order. Edmunson said telecoms operators needed to have access to several scarce national resources, including number ranges, frequency and land, which were effectively “owned” by the state.
Licences set out rules for operating and penalties for noncompliance, she said, noting that conditions were based on similar principles worldwide, if the country in question was a member of the World Trade Organisation and International Telecommunications Union.
“However, some licence conditions can be very restrictive. Regulators usually have the power to make regulations and issue directions as well, which also apply to licensees.”
In some countries, such as China, and several countries in the Middle East, operators may not make internet access available unless it is heavily restricted and monitored.
Edmunson said failure to comply with the national telecoms law, licence conditions and other regulations could result in penalties being applied, such as revocation in material, substantial and repeated cases of breach; fines; the imprisonment of directors; the suspension of licences, and the revocation of certain rights.